As business owners strive to keep their companies afloat in light of recent Covid-19 closures, many are discovering the importance of keeping detailed, easily accessible business records. At any given time, owners may need to refer back to important legal documents or financial records, and not having them on hand can sometimes be the difference between survival and closure. Today's Aegis blog post looks at several reasons why business owners need to keep important, detailed business records in an accessible place.
Requesting Emergency Loans or Federal Aid
Congress recently approved billions of dollars in federal aid and loans to businesses across the country impacted by Covid-19, but companies must provide specific paperwork to verify their payroll and income to banks and government agencies. Without these files and documents on hand, companies could be delayed or completely miss out in getting the financial help they desperately need because of the limited funds available and the large number of companies applying for aid.
Tax and Audit Purposes
Thorough business documentation is also important for corporate tax and audit purposes. Although the government has extended the deadline for tax filing due to Covid-19, it does not mean that companies are absolved from eventually filing and meeting all tax obligations. In addition, the IRS will eventually resume corporate tax audits, and companies should always be prepared to answer any tax questions with relevant receipts and records. Payment delays or incomplete tax records could lead to additional taxes and penalties, which could decimate businesses already struggling with lost revenue.
Simplify Filing Insurance Claims
Finally, companies that are closed or working with reduced hours because of Covid-19 are still vulnerable to disasters or liability claims, so insurance claims may need to be filed to protect against damages or losses. When a business suffers a fire or theft, they will usually be asked to provide documentation on property value, financial records, inventory totals, and other important information. If these documents are unavailable, then it could impact the speed and scope of the insurance claim and significantly lower the amount a company receives to cover losses.
Companies can help ensure they have access to essential documentation at all times by utilizing cloud-based file storage services and making digital copies of their most important paper documents for tax, legal, insurance, and financial purposes. Aegis Insurance & Financial Services is also committed to helping clients get the financial peace of mind they need in these chaotic times by offering comprehensive Business Insurance policies that meet their specific needs, all at competitive prices. Contact Aegis today for more information on analyzing insurance needs and specific policy information at 713-850-7622.